At the end of this section of the course, you will be able to:
• Explain that economics is a social science. • Outline the social scientific method. • Explain the process of model building in economics. • Explain that economists must use the ceteris paribus assumption when developing economic models. • Distinguish between positive and normative economics. • Examine the assumption of rational economic decision-making. • Explain that scarcity exists because factors of production are finite and wants are infinite. • Explain that economics studies the ways in which resources are allocated to meet needs and wants. • Explain that the three basic economic questions that must be answered by any economic system are: "What to produce?", "How to produce?" and "For whom to produce?" • Explain that as a result of scarcity, choices have to be made. • Explain that when an economic choice is made, an alternative is always foregone. • Explain that a production possibilities curve (production possibilities frontier) model may be used to show the concepts of scarcity, choice, opportunity cost and a situation of unemployed resources and inefficiency.
Week One: Introduction to IB Economics
Homework Due: None
Assessments and Activities: Today, we will be getting textbooks and taking care of basic business. We will talk about the things you’ll need to to know to get along in this course, including familiarity with this site
Incentives:
What's the Point?
Week 2: The Economic Principles ("thinking like an economist")
Homework Due:
Assessments and Activities: Lecture (click link, print and bring document below to class)
Assessments and Activities: Free-response/problem and lecture
Free-response/problem: You will work cooperatively with your partner to construct a response to the following prompt.
Imagine a society that produces capital goods and consumer goods.
Draw a production possibilities frontier for capital goods and consumer goods. Using the concept of opportunity cost, explain why it most likely has a bowed-out shape.
Show a point that is impossible for the economy to achieve. Show a point that is possible to achieve but inefficient.
Identify a point that is productively effiicient and explain why it is productively efficient.
Define allocative efficiency. Identify a point that might be allocatively efficient and explain what must be true for this to be an allocatively efficient outcome.
Lecture: Specialization, trade and comparative advantage
Assessments and Activities: Free-response/problem and lecture
Free-response/problem: You will work cooperatively with your partner to construct a response to the following prompt.
American and Japanese workers can each produce 4 cars a year. An American worker can produce 10 tons of grain a year, whereas a Japanese worker can produce 5 tons of grain a year. Assume each country has 100 million workers.
Graph the production possibilities frontier of the American and Japanese economies.
For the United States, what is the opportunity cost of a car? Of grain?
For Japan, what is the opportunity cost of a car? Of grain?
Which country has the absolute advantage in the production of cars? Grain?
Which country has the comparative advantage in the production of cars? Grain?
Assume that originally there is no trade between Japan and the U.S. Identify an example in which trade makes both countries better off.
Lecture: Rationing systems and the circular flow model
Free-response/problem: You will work cooperatively with your partner to construct a response to the following prompt.
Draw a circular flow diagram. Identify the parts of the model that correspond to the flow of goods and services and the flow of dollars for each of the following activities.
Selena pays a storekeeper $1 for a quart of milk.
Stuart earns $4.50 per hour working at a fast-food restaurant.
Shanna spends $30 to get a haircut.
Sally earns $10,000 from her 10 percent ownership of Acme Industrial.
Class Discussion: Once you have completed your response, there will be a discussion on today's reading.
At the end of this section of the course, you will be able to:
• Explain that economics is a social science.
• Outline the social scientific method.
• Explain the process of model building in economics.
• Explain that economists must use the ceteris paribus assumption when developing economic models.
• Distinguish between positive and normative economics.
• Examine the assumption of rational economic decision-making.
• Explain that scarcity exists because factors of production are finite and wants are infinite.
• Explain that economics studies the ways in which resources are allocated to meet needs and wants.
• Explain that the three basic economic questions that must be answered by any economic system are: "What to produce?", "How to produce?" and "For whom to produce?"
• Explain that as a result of scarcity, choices have to be made.
• Explain that when an economic choice is made, an alternative is always foregone.
• Explain that a production possibilities curve (production possibilities frontier) model may be used to show the concepts of scarcity, choice, opportunity cost and a situation of unemployed resources and inefficiency.
Week One: Introduction to IB Economics
- Assessments and Activities: Today, we will be getting textbooks and taking care of basic business. We will talk about the things you’ll need to to know to get along in this course, including familiarity with this site
Incentives:What's the Point?
Week 2: The Economic Principles ("thinking like an economist")
Week 3: Scarcity, opportunity cost and the production possibilities model
Week 4: Specialization, trade and comparative advantage
Week 5: Rationing systems and the circular flow model
Review: Intro to Economics Discussion
Introduction to Economics Test (Multiple-choice)
Related Readings:Comparative Advantage
Related Readings: